Apple Shares to Surge Ahead; Bullish Trend for USDJPY
Further Upside for USDJPY | Next Resistance at 120.00
After breaking above its descending triangle resistance on the 4-hour and 1-hour time frames, USDJPY seems poised for further upside as it also formed a continuation pattern. The pair broke above a bullish flag seen on the 1-hour chart and indicated an increase in buying momentum, possibly until the 120.00 major psychological resistance.
Stronger buying pressure might even lead to a test of the previous year highs near the 121.00 mark and the top of the triangle. After all, the US just printed a stronger than expected employment report and the FOMC confirmed its shift to a more hawkish stance when it upgraded its growth and inflation outlook.
Meanwhile, Japan has seen another set of bleak data recently, as inflation and spending reports have disappointed. Earlier in the week, the tertiary industry activity index churned out a 0.3% decline instead of the estimated 0.1% uptick, hinting that further economic weakness might be seen.
However, if the yen manages to resume its rallies, USDJPY could retreat back to the broken resistance level near the 118.00 handle. Further losses could mean a move back to the key support area at the 116.00 major psychological handle.
NZDUSD Short-Term Ascending Triangle | Resistance at .7450
NZDUSD is currently consolidating below the .7450 minor psychological resistance, which is the top of the short-term ascending triangle pattern on its 1-hour time frame. The top of the formation appears to be holding for now, indicating that another test of support is likely.
A downside break might also take place if risk aversion kicks in, although there seem to be no major catalysts lined up for today. Talks of a Greek exit from the euro zone seem to be weighing on risk appetite, keeping gains of the higher-yielding Kiwi in check.
The path of least resistance is to the downside, as the US economy is on a much stable economic footing compared to New Zealand. The US printed a very strong jobs report for January, indicating that a stronger economic recovery is likely and that the Fed might be able to hike interest rates later on this year. Meanwhile, the RBNZ has recently shifted to a more cautious stance, hinting that they are open to cutting interest rates if necessary.
If the selloff resumes, NZDUSD could test its former lows near .7200 and perhaps create new lows around the .7000 key support zone. An upside break from the triangle resistance, however, could mean a move towards the nearby area of interest at .7600.
Apple Shares Establish New Highs | MACD and RSI Show Buying Momentum
Apple shares have finally broken past the previous year highs at the $120/share mark and zoomed up to new highs at $122.02/share. This indicates that investors have a very positive outlook for the company and the share price, spurred mostly by stronger than expected earnings data released earlier.
Further rallies could last until the next resistance at $125/share, at which some traders might book profits. However, if the upside break proves to be a fake out, price could retreat until the bottom of the previous range around $105/share.
The path of least resistance is to the upside though, as improving economic data from the United States have supported their equity indices so far. This is a sign that consumer confidence is improving and that this could continue to sustain spending and growth in the coming months.
MACD is moving higher, confirming that buyers are piling on their long positions on Apple shares. RSI is also climbing and hasn’t quite reached the overbought zone yet, suggesting that there is enough buying interest to sustain price rallies and form new highs for the stock.